UPDATE: House panel OKs medical malpractice cap increase

Medical malpractice victims would be able to receive more compensation under a measure an Indiana House committee approved Monday that would update the payment cap for the first time in nearly 18 years.

The bill, which passed the Judiciary Committee 11-1, would increase the limit on the amount victims can receive by $400,000, to $1.65 million. It would then gradually increase every four years until 2031 to keep up with inflation, with a final cap of $2.25 million. The bill now heads to the full House for consideration.

"My goal is that we address those in a periodic increase because we the Legislature don't do a very good job with keeping pace with the cost of living," Sen. Brent Steele, R-Bedford, said. "I think it's extremely important that we put periodic increases in it so the act jeeps its stability and doesn't run into what it's run into now."

Steele also said the proposal would protect the cap from constitutional challenges that may arise since the cap does not keep pace with inflation.

But the measure was originally the basis of a Senate bill, authored by Steele, which previously died in the Senate. Steele has said he aimed to find a compromise between physicians who are worried about ballooning malpractice insurance costs and lawyers who represent patients injured or killed because of medical mistakes.

The House committee revived the measure Monday after stripping an unrelated bill in a last-ditch effort to shove the proposal forward.

The move came amid objections from medical associations that opposed the cap increase saying doctors would not be able to absorb the costs as their malpractice insurance premiums would also rise. Though most opponents supported the initial $400,000 increase, they largely opposed the continuing increase.

Mary Abernathy, executive director of Medical Education at St. Vincent Indianapolis Hospital, said increased liability costs could also deter students from wanting to become physicians in Indiana.

"A rapid increase would create anxiety in young Hoosiers deciding whether to even train as a physician or even to stay and work in Indiana," Abernathy said.

But Daniel Ladendorf, legislative chairman for the Indiana Trial Lawyers Association, which supports the cap increase, has argued the rising costs are problems best addressed by medical insurance companies, not the patients.

"That's not the problem of a patient that's been seriously harmed by a doctor's negligence," he said. "That's a business issue."